Energy company warns consumers to expect more price hikes before winter

Scottish and Southern Energy (SSE), Britain's second-largest domestic energy supplier, today warned its 9 million customers to expect another round of prices rises before the winter.

The group said the full impact of soaring oil, electricity and gas prices "has still to be felt" and that its profits for the half-year to end September would be "substantially lower".

"We are continuing to resist the pressure to put up prices for domestic customers, but doing so is becoming more difficult by the day," said chief executive Ian Marchant. "I can't see it won't happen before winter."

But he added that price hikes were not imminent - "we will try and wait a bit" - as oil prices have come off their highs of nearly $150 a barrel and traded at less than $130 in recent days.

SSE said it would make most of its profits between October and March. Thanks to a better second half, the company expects to post a "modest increase" in full-year figures.

A surge in wholesale gas costs prompted a round of price hikes from the "big six" power companies at the start of the year - triggering a probe by energy regulator Ofgem. SSE became the last of the big six to raise tariffs in March, announcing price hikes of nearly 16% from April 1. That meant the average dual fuel customer's bills climbed to £1,066 a year.

The profits warning pushed shares in SSE down by 4.6%, or 66p, to £13.79.